The acquisition amount will be 63.5 million Brazilian real ($12.72M USD).
Japanese Sakata Seed Corporation entered into an agreement through its South American wholly-owned subsidiary Sakata Seed Sudamerica LTDA to acquire all shares of Isla Sementes LTDA.
The agreement expands Sakata’s flower and vegetable seed portfolio and reach in Brazil. Currently, Sakata sells flower and vegetable seeds via its Sakata Seed Sudamerica LTDA subsidiary to medium and large-scale commercial growers in Brazil. Isla also specializes in flower and vegetable seed sales in Brazil, but to a smaller scale, home gardeners and smallholder farmers.
Sakata values the domestic gardening and smallholder farmer market in Brazil at approximately $20M USD. Brazil’s population of over 214 million people, and the fact the country is poised for future economic growth, mean Sakata sees upside sales potential in this market, according to the release.
Sakata expects to generate a combined sales increase of about $3M USD in five years from these synergies, according to the release, and anticipates being able to make more effective use of the two companies’ individual supply chains, production facilities and research capacity.
Isla’s portfolio includes varieties tailored to home gardeners and smallholder farmers. Additionally, they offer microgreen seeds and organic seeds, both specialities whose markets are expected to grow. Sakata may leverage its sales network to sell Isla’s products to a larger global audience. Sakata says it will keep the Isla brand after the acquisition.
Sources: Agro Pages, Seed World
